Trusts

Can you be more specific? Do you mean "estate" for probate purposes, "estate" for tax purposes, or something else.

Assuming that you mean not part of the estate for tax purposes, the short answer is "when the trust is irrevocable the the person who set it up (grantor/settlor/trustmaker) did not retain any 'incidents of ownership' in the trust's assets.

Because we're dealing with the internal revenue code, however, the answer isn't usually quite so simple. For example, a life insurance policy owned by an irrevocable life insurance trust (ILIT) usually is not part of the decedent's taxable estate. But if the deceden set the trust up with a pre-existing life insurance policy and transferred it into an ILT within 3 years of death, it will be part of his taxable estate.

And even if the trust wasn't set up with a pre-existing policy, it may be subject to gift taxes if it was funded with more than $12000 per year per person of insurance premium payments.

Likewise, a qualified personal residence trust (QPRT) may not be part of the taxable estate, as long as the term of the QPRT has expired, but it will be part of the estate if the decedent didn't outlive the term.

I could give more examples, but they may not be relevant to your situation.


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